Utility companies have historically used the method of reading meters and rendering bills as a means for collecting for electric, gas, and water service after it has been used by the customer. This is a costly and time-consuming method which is viewed with suspicion by a large number of customers, and often results in misunderstandings, disputes, late payments, and losses to the utility company due to bad debt. In addition, the customers have no ready way of reading or understanding on a daily basis the cost of the electricity, gas or water they are using. Customers generally do not know their usage status or costs until they receive a bill, which typically covers a consumption period that occurred during a period spanning 15-45 days prior to the receipt of their bill.
Prepayment metering systems have been proposed in the prior art as a technology for overcoming some of the aforementioned shortcomings. Some of these prepayment systems were designed so that the purchase of a supply of electricity, gas or water is made at a central station such as the gas or electric utility office, and the information regarding the amount of the purchase is then communicated to the customer site where the utilities are consumed. At the customer site a metering device is installed which is designed to receive the prepayment communication information and credit the user with the amount purchased at the central site. These types of proposed prepayment metering systems will reduce the overall cost of utility distribution by reducing or eliminating meter reading expenses, bad debt collection, account transfer expenses and credit department expenses, while at the same time providing a greater awareness on the consumer's part as to his or her consumption habits.
An example of a prior art utility metering device of the aforementioned type is described in U.S. Pat. No. 4,240,030 to Bateman et al., which describes a microprocessor-controlled electric utility meter which receives prepayment information on a mag-stripe card or writes postpayment information on a mag-stripe card, depending on whether the meter is in pre-payment or postpayment mode. In prepayment mode, this meter credits the user's account to the dollar amount on the mag-stripe credit card. This device includes a display that the customer can use to monitor the utility usage at the customer site on a daily basis.
While the proposed prepayment metering systems for purchasing of utilities have great advantages, the systems proposed thus far also include many disadvantages which are of particular concern especially when using a mag-stripe credit card type of communications medium between the utility and the customer site. This communicating medium is not secure, and the messages are subject to interception, analysis, alteration, or counterfeiting. In addition, the mag-stripe cards can be lost, stolen, or simply may not work the first time they are tried in the customer-site utility metering device.
The present invention overcomes these and other shortcomings of the prior art utility metering systems by providing for a simple, low-cost utility metering system based primarily on existing and off-the-shelf components and by placing the security emphasis on the credit card medium by providing a simple, low-cost method of transferring value information to the customer site. The present invention uses an encoding scheme and relies on other mechanical and monitoring devices to bolster the overall security of the system.